Bike-sharing giant ofo has finally agreed to be bought out by Didi-Chuxing according to Chinese media. The deal is said to be worth $2 billion and that all other co-founders, except for CEO Dai Wei, will be leaving the company, according to the report.
GeekPark, a major Chinese technology media, broke the news in the afternoon of August 22. The article states that the deal for Didi to purchase ofo have been finalized and that the price tag is around $2 billion. It claims that many of ofo’s investors have been receiving documents recently that needed their signing, and that Dai is keeping his seat on the board “for the time being” while the four other co-founders are ousted.
Yu Xin, the co-founder that has publicly denied other rumors in the past, immediately took to WeChat to deny the reporting, calling it “fake” and stating that the end is “nowhere near.” The transportation unicorn Didi-Chuxing declined to comment.
GeekPark then commented under its news article and pinned the comment on top stating that the information published was acquired first-hand and cross-examined with other sources. It goes on to acknowledge Yu’s response and Didi’s stance, saying all these information will help readers better understand the complexities of this situation.
Since Meituan-Dianping’s acquisition of Mobike in April, there have been incessant rumors of Didi buying out ofo. It was reported in May that Dai Wei had rejected an acquisition deal from Didi and was calling all employees to “fight until the end”. In the months that followed, ofo closed its operations in several U.S cities and pulled out of a few Europeans countries and cities.
Meanwhile, bright sides of its fight have been showing. In an internal meeting held in June, the company announced that it has successfully diversified its businesses, lowered operational costs by 80 percent, and has pulled in more revenue in Q1 2018 than in the entire year of 2017. Ofo has also started to explore other ad revenue methods, and has made more than 100 million yuan ($14.6 million) from ads on the frames of bicycles alone. It hasn’t been all bad news for ofo as its fight is starting to show results.
Without an official confirmation from ofo or Didi, the guessing game surrounding ofo’s fate is likely to continue as it remains the only independently-run bike-sharing company in China.